Possible Edward DeMarco Replacement at FHFA Has History With Credit Unions

The FHFA has been the regulator and effective owner of the two giant secondary mortgage market institutions, Fannie Mae and Freddie Mac.

Media sources reported over the weekend that Mark Zandi, chief economist at Moody's Analytics, is a lead contender to replace DeMarco.

DeMarco has been criticized for not endorsing principal reduction as a means of moving the housing market past the finance crisis and helping more homeowners remain in homes they purchased at very high prices during the housing bubble.

Credit unions have been generally supportive of DeMarco's leadership but some were also concerned about whether they would retain access to secondary housing finance markets as secondary mortgage market reform went forward under DeMarco.

Zandi joined Moody's in 2005 when the ratings agency purchased an economic forecasting firm him he helped found, according to the reports.

Media outlets reported that the decision has not been finalized and that other names under consideration included Rep. Mel Watt (D-N.C.).

Neither the White House nor Zandi have commented on the report. Zandi was known as an economic pessimist during the run-up to the financial crash but has since been seen as more of an economic optimist about the recovery, published reports said.

If Zandi was named to the position, media outlets reported he might find some friends among Republican senators which could help his confirmation effort.

Credit unions also may support a Zandi nomination.

Before he became chief economist at Moody's Analytics, Zandi addressed the 2004 annual meeting of the American Credit Union Mortgage Association, the only credit union trade association dedicated solely to housing finance and the group said he has maintained contact since.

“Since that time Zandi has been a good friend to ACUMA, providing his annual Housing Forecast for our Pipeline magazine and maintaining contact with us on key issues,” the group's president, Robert Dorsa, wrote in a blog entry about the possible appointment. “Zandi has appeared numerous times on CNBC, CNN and other news networks and is one of the nation’s most trusted economists,” ACUMA said.

“His timely reports on housing issues on the future of the housing markets have been accepted by leaders of both political parties. ACUMA wishes Mark well as he prepares for a new chapter in his life and career. We sincerely hope he is appointed and confirmed by the Senate to lead the FHFA,” the association added.